It’s flu season again. Or was that in autumn? You’ve been feeling off for a while now. Time to look up the advice about vaccines, vitamins, and healthy habits. In the end, it’s all for the greater good, right? But what happens when this run-down, not-quite-yourself feeling isn’t limited to a single season? What can you do when none of the precautions you take prevent the inevitable? If you’re in the insurance market—any insurance market—you’ve probably asked yourself or your board these questions.
Whether your company offers health, life, auto, or home insurance, if it’s like many other carriers, each new quarter Low market expansion, fierce competition, and new legislation can weaken the immune systems of even the most established players, making them prone to what analysts and journalists call “bad years.” Such years come with few new policies, lots of claims, and multiple legislation changes that can impact how and to whom your company sells its products. Add on the fact that most insurance products have become increasingly difficult to differentiate, and it’s no wonder that the road to recovery is harder and harder to catch sight of.
While recent years have witnessed an increase in profit, especially within the healthcare domain, at the end of 2016 insurance rates were entering their 15th quarter of decline, according to a Marsh Report. This doesn’t necessarily imply the onset of a bad year, but it does mean that fewer clients will be likely to increase coverage in the near future. When the only difference between your policy and the competition’s is the mascot on the front page, you know that your agents have a tough challenge ahead of them. One that not even Flo, Progressive’s picture-of-health cashier, or Jake from State Farm can tackle on their own.
To relieve these common symptoms, it’s important to first understand the different types of channels that insurance companies use and eventually compete in. With omni-channel as the new norm, companies are continually piecing together different types of data in order to reach their customers across multiple touchpoints. McKinsey & Company even share the example of a bank that increased its product sales by more than 25 percent in six months through omni-channel use. To stay competitive in such an environment, it’s necessary to implement top-notch distribution management processes that allow your insurance company to effectively manage all distribution channels while also expanding into new markets and exploring new possibilities. Such processes can even help you maximize upselling and cross-selling potential as well as adjust sales compensation plans to fulfill new requests from supervisors.
Still, while maximizing potential through top-notch distribution management provides real benefits, is it enough to protect you? Will it propel you ahead of your competition and block their advance? Will it help you adapt quickly to legislation changes?
It will, as long as you also develop your sales enablement capabilities. Sales enablement equips your agents and brokers with the necessary tools to accelerate the deal. Enabling your team can take multiple forms, from streamlining your sales processes to optimizing your content’s format, delivery, and accessibility. But several of these methods stand out as being particularly useful for companies struck by a bad year.
1. Fortify Your Training Program
Training and coaching may not come to mind first when trying to determine how to protect your business, but for your distribution channels, they’re invaluable. Creating efficient, skills-oriented programs can accelerate onboarding procedures, increase the satisfaction of your current producers, and provide support and resources during the implementation of meaningful changes to your company’s strategy.
Everything from new acquisitions to mergers can gradually be communicated to the agents and brokers who rely on this type of input. There’s also nothing more effective than a constant supply of information from official, trustworthy sources for stopping the spread of false rumors. A steady stream of info negates the need for agents to seek information elsewhere, thus nullifying hearsay or unsubstantiated stories.
2. Protect Your Best Talent
Good producers are your best defense against bad years: they keep your profits safe and can help you prevent future financial issues. But how do you attract them? For starters, try implementing a competitive commission program and bonus system, along with the sales enablement techniques that can help agents succeed. Individual performance must be measured on the metrics that matter most to sales, rather than assessed within the context of specific, company-wide objectives. The new business your producers close and the customers they retain—with regular policy sales or more complex contracts—can hold more importance to them than a five-year sales projection. It’s critical to remember that your agents, captive or independent, are much more than names on a list. Valuing their priorities will go a long way toward solidifying your relationship with them and winning their loyalty.
3. Prevent Future Compliance Issues
In an increasingly competitive market, the closest thing you can get to a prevention program is legal compliance. You may feel that investing in compliance is too much—especially when other problems are higher on your daily priority list—but keep your eye on the prize: you‘ll definitely experience the positive effects of such an initiative in the future. Understanding local legislation is vital for your producers, whether they’re validating licenses or providing self-service and legal references to distributors.
4. Get Old Vulnerabilities Treated while Strengthening Your Budget
Some carriers still depend on multiple, often outdated, or inadequate platforms and processes to manage commissions and bonuses. Such unreliable platforms and processes may include anything from the overuse of spreadsheets to the use of traditional policy administration systems. When the market was dominated by just a few key players, these solutions might have been enough for a company’s needs. But today’s competitive landscape requires the insight of tomorrow. Any technology that risks slowing your sales process makes you vulnerable. You need an accessible way of administering your distribution channels, along with cross-channel, fully mobile sales enablement. You need a single, secure platform.
A comprehensive, robust platform helps you keep your costs in check, reduce distribution management costs, and reclaim valuable resources. It will also make it easier to manage onboarding, licensing, and appointments, ensure timely and accurate commission and bonus payments, provide clear and insightful reports and analytics, and speed the process of dispute investigation and resolution. Furthermore, using distribution management along with sales enablement strategies like content optimization and cross-channel distribution will save you time and money. An optimized platform automates time-consuming tasks, helping you manage everything from daily appointments to license distribution, agency contracts and compliance documents.
You can take a few steps toward overcoming vulnerabilities without additional resources or people. However, a new distribution management system, along with a healthy, regular dose of sales enablement, has the potential and the power to get your agents in top shape. Simply go to the nearest financial doctor’s office and tell him you need something for the flu. You don’t have to be specific. He’ll take one look at your reports and instantly know you’re in the insurance business!
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